TPT September 2009

82 / 140

Global Marketplace
80 September 2009 ›
Customers in Japan, South Korea, and the US have already bought
all the gas to be produced at the Sakhalin II plant over the next
20 years. Obviously pleased with Shell’s performance, Prime
Minister Putin told Mr Van der Veer, “The work goes on successfully
and ahead of schedule. We will have a chance to diversify our
cooperation.” For his part, the Shell official said that his company
was ready for more work, and that he hoped the necessary licenses
and permissions to begin would be issued promptly.
On the same day as the meeting in Moscow, Shell signed a deal
with the Russian state-owned shipping company OAO Sovkomflot
to build tankers for transporting LNG produced at Sakhalin II to
Europe. Earlier in the month, Gazprom’s CEO Alexei Miller said
his company was considering inviting Shell to participate in LNG
projects on the Yamal peninsula in western Siberia.
› Shell is not the only Western company to be tapped by Russia
for assistance in exploiting its challenging oil and gas fields. On
24 June, the French ‘supermajor’ Total and the Russian gas firm
Novatek agreed to invest some $900mn in joint development of a
gas field in western Siberia. The deal was the first major foreign
investment in Russia’s energy sector to be announced this year.
And Total, together with Norway’s Statoil Hydro, is working with
Gazprom on the huge Shtokman field in the Barents Sea. Russia
has also invited foreigners to help develop the Arctic shelf off its
Pacific coast.
French economic stimulus
Fast off the mark, but with a care for la beauté
The Organisation for Economic Cooperation and Development
expects the gross domestic product (GDP) of France to drop only
4% from the peak of the current economic cycle, far less than the
7.4% plunge expected in Germany. The OECD, the Paris-based
intergovernmental research and policy advisory agency for the
world’s industrialised countries, also says that French economic
decline is likely to be significantly milder than in Spain, Belgium,
and Britain. To offer another comparison, the American economy is
expected to shrink by 3.5% before starting to grow again.
What explains these discrepancies? Nelson D Schwartz is the
European economics correspondent of the New York Times,
reporting on companies and economic trends on the Continent.
He attributes the definitely brighter outlook from his office in Paris
largely to the French government’s $37bn economic stimulus
programme, which requires all projects to be under way in 2009 and
expects to have emptied its coffers by 75% by the end of the year.
“As it turns out,” wrote Mr Schwartz, “France’s more centralised,
state-directed economy – so often criticized in good times for
smothering entrepreneurship and holding back growth – is proving
remarkably effective at deploying funds quickly and efficiently” in
bad times. (“Unlike US, France Is Deep into Stimulus Projects,”
7 July.)
A notable feature of the French initiative is the earmarking of stimulus
funds for restoration and improvement of cathedrals, chateaux,
palaces, museums, and other monuments of the nation’s cultural
patrimony – as well as a new $14mn centre for Mediterranean
culture, at Marseilles. These efforts are going forward even as
France races ahead of the US in such ‘shovel ready’ projects as
upgrading railroads and filling potholes.
“America is six months behind,” Patrick Devedjian, the minister in
charge of the French relance, or stimulus, told the Times. “It has
wasted a lot of time.” (The reference is, of course, to US President
Barack Obama’s economic stimulus plan, which will not reach the
current French disbursement percentage until the fall of 2010.) In
Mr Devedjian’s opinion, by the time Washington gets around to
doling out most of its money, the economic crisis could be over.
› The minister in charge of the stimulus is not the only optimist to
be found in French official circles. Insee, the National Institute
of Statistics and Economic Studies, expects the economic situation
to stabilise in France by the fourth quarter of 2009, around the time
that the American economy is expected to start sending up the
‘green shoots’ that Mr Obama is expecting. Eric Dubois, head of
Insee’s short-term analysis department, has even said he discerns
“a growing possibility” that French GDP could rise as early as the
third or fourth quarter. Update: It was announced on 13 August that
France, along with Germany, had seen a second quarter increase in
GDP of 0.3%, after four consecutive quarters of contraction.
› But the Times noted that, despite these expressions of
confidence, France remains highly vulnerable to the threat of
rising unemployment. The OECD expects the French jobless rate,
currently 8.9% and lower than the 9.5% rate in the USA, to hit 11.2%
by the end of 2010, above the expected American peak of 10.1%.
As Hervé Boulhol, head of the France desk at the OECD, told
Mr Schwartz in early July, “There has been a lag with unemployment,
but now it will start to bite.”